Kito Licence Related, page-53

Must be soon. The article below might be an old story copied again.

Feb 23, 2017
http://www.tanzaniainvest.com/energy/oil-drilling-morogoro-swala-2017

Australian oil and gas exploration company Swala Energy (ASX:SWE, DSE: SWALA) recently announced that it has been working closely with the Tanzania Petroleum Development Corporation (TPDC) to ensure that the Kito-1 prospect in the Kilosa-Kilombero valley in Morogoro could be drilled in 2017. At the beginning of February 2017, Swala and TPDC carried out a joint program to inform on the planned drilling program and update the local communities around the drilling area. On February 9th, 2017 TPDC confirmed that the Ministry of Energy and Mines of Tanzania has extended TPDC’s license rights over the Kilosa-Kilombero area for a further 12 months (the license´s first extension term expires on February 20th, 2017). TPDC in turn required the contractor parties (Swala, Otto Energy and Tata Petrodyne) to provide financial guarantees covering the minimum well commitment before it extended the Production Sharing Agreement (PSA). Swala explains that these guarantees required under the terms of the 2012 PSA cover minimum commitment obligations of USD6m and can be drawn down as the drilling program progresses. These conditions must be satisfied by February 20th, 2017 when the license´s first extension term expires. David Mestres Ridge, CEO of Swala, said: “TPDC and Swala have worked hard over the past months to ensure that Kito-1 could be drilled in 2017 and both companies remain committed to ensuring its success. In these circumstances TPDC has decided to require tangible commitment from the Joint Venture and will clearly take account also of the remedy of existing defaults before deciding on the PSA extension. The guarantees are, essentially, ‘ringfenced’ drilling costs and covered by our farm-out agreement. The Company shall inform the market as the conditions under which the PSA extension is awarded become clearer.” The Kilosa-Kilombero license covers an area of 17,675km2, located on the East African Rift System (EARS), which is a proven oil trend, Swala indicates.

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